Am I doing this right? My partner doesn't think so

[Perchy]

So approximately 6 years ago with approximately $30k cash deposit for a 2 bedroom unit (this included government $7k bonus) which we lived in for 6 months. My SO then gets a job at my company and we decided to get a house. 6 years so later we are now renting out both properties while we are renting elsewhere (just had first child, moved closer to family and both have since changed jobs).
At our 2013 tax statement - after mortgage fees, interest, etc. it works out that the unit we are paying EACH of $7/week to own (currently the rental income is higher than the mortgage payment) and the house is about $23/week to own (it was only rented for approx 3 months of that taxable year).
I am convinced that we are setting ourselves up well for retirement to have two investment properties. But he constantly complains because its negative but I guess I don't know how to explain it well enough to him? Or am I calculating it wrong? I mean at $7/week each.. that's more than his coke habit (coca-cola that is).
Help me to explain it in a way that my SO can see the benefit of property investing versus doing nothing with our money?

 

[Colin Rice]

You would have had capital growth in that time period which in effect is money that you would not have had if you didn't pay the minimal holding costs.

Put the rent up next review if feasible and that will cover the "shortfall".

Tell him to give up his coke habit if it is stressing him out that much

Be warned, he may find something else to complain about once you resolve this issue

 

[geoffw]

It is a very big thing to have a partner who is not on the same wavelength.

Had it not been for my partner, I may well have bought more properties- but I would have also taken more unnecessary risks. On balance, it balances.

For me, I think that having to justify in detail to a partner helps me to see the good and the bad, which I may have otherwise ignored.

If your partner is a reader, perhaps it might be worth while to give him a book like Jan Somers More Wealth from Residentail Property. It really explains well the long term benefits.

 

[kathryn d]

Perchy,
I know many don't agree, and prefer IO mortgages, but if you were paying P&I, and then if you could still afford to buy more, your partner could see a light at the end of the tunnel?

 

[PrimeProperty]

You make money in residential investment through leveraging other people's money ( the bank). Thus, take the value of the property when you purchased it and compare it to its value today. Assuming you are in the Brisbane market I would expect that you would have made at least $50k in capital growth over that period? Then compare what you would have got by investing your $7 per week in the bank over the same period, the difference will be significant. It seems to me that sacrificing $30 per week to hold 2 investment properties is a small sacrifice to make towards your future wealth. Also, there may be ways now to make the properties cash flow positive and thus remove any of your partners concerns.

PM me if you would like further detail.

 

[The Y-man]

At our 2013 tax statement - after mortgage fees, interest, etc. it works out that the unit we are paying EACH of $7/week to own (currently the rental income is higher than the mortgage payment) and the house is about $23/week to own (it was only rented for approx 3 months of that taxable year).

As others have said - has the property gone up by more than $7/week over the time you have owned it (net of selling costs etc). If it hasn't then the SO is right....

Actually, if we were being pedantic, you need to factor in the fact that the 30K deposit you had would have earned interest over that time, so you need to discount this too.

The Y-man